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Price of rice to crash as Buhari launches mega rice pyramids

From Left: President Muhammadu Buhari presents an award to the CBN Governor, Godwin Emefiele, for a job well done, while the Ekiti State Governor, Dr Kayode Fayemi watches during the launch of the 2022 FCT Mega Rice Pyramids at the Trade fair Complex in Abuja.

. Emefiele says project demonstrates self-sufficiency in food production

By Victor Uzoho

President Muhammadu Buhari, yesterday, unveiled the mega rice paddy pyramids in the Federal Capital Territory (FCT), with each pyramid consisting over one million bags of rice, reputed as the largest in the world.

Speaking at the event, the President said the pyramids, 15 in number, will engender food security and drive down prices of food in Nigeria.

According to Buhari, after the inauguration of the Anchor Borrowers Programme (ABP) in 2015, the national paddy rice production rose from about 4.5 million tons per annum to over 9 million tons in 2021.

He commended the Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, for Initiating the ABP, through which the increased rice production was achieved.

Remarking, Emefiele said the ABP was initiated to curtail food import, noting that Nigeria has witnessed an increased reduction in rice import.

For instance, he said: “By 2016, rice imports from Thailand had fallen to only 58,000 metric tons. As of the end of 2021, they only exported 2,160 metric tons to Nigeria, thereby saving us foreign exchange and helping preserve jobs in Nigeria.”

The CBN Governor also commended the Nigeria smallholder farmers and the leadership of the various commodity associations for their diligence, bravery, patriotism, and adaptability amid insurgency, banditry, lock downs and other related setbacks.

He said: “Indeed, we lost some farmers to insurgency attacks nationwide whilst some could not access their farmers for several months. Yet, they kept the faith. They did not give up. They persevered. They did not abandon our fight for food self-sufficiency.”

These expansions have not only made Nigeria the largest rice producer in Africa, but have also unlocked enormous private sector investment in the rice value chain.

Agricultural revolution

Emefiele noted that the flagship Anchor Borrowers’ Programme has catalyzed the rural economy and has built a sustainable framework for financing small holder farmers in Nigeria.

He said the Programme has developed an ecosystem among all nodes of the agricultural value chain and these linkages can be better optimized through synergy among all stakeholders.

“As at the end of December 2021, we have financed 4,489,786 farmers that cultivated 5,300,411 hectares across 21 commodities through 23 Participating Financial Institutions in the 36 states of the Federation and FCT.”

He added that these efforts have yielded fruits in not just increasing the availability of rice, but also in moderating prices, reducing imports and increasing job creation in the country.

Beyond increasing the national output from about 5.4 million metric tons (MMT) in 2015 to over 9 MMT in 2021, he said the ABP has also significantly improved the productivity per hectare of the smallholder farmer from about 2.4 MMT per ha in 2015 to between about 5MT  per ha in 2021.

“These expansions have not only made Nigeria the largest rice producer in Africa, but have also unlocked enormous private sector investment in the rice value chain as the number of Integrated Rice Mills grew astronomically from six in 2015 to over 50 in 2021 with many more in various stages of completion. Today, Nigeria’s milled rice matches the foreign rice in quality,” he added.

This will lead to a drastic reduction in price once it starts rolling into the market. Our collaboration with the millers association rests on the agreement that they will sell at a discounted price to Nigerians.

Other interventions

Flowing from the successes in the rice value chain, Emefiele informed that the ABP commenced the “Brown Revolution” last year for the transformation of the wheat value chain in Nigeria.

According to him, wheat accounts for the second highest food import bill in Nigeria, thereby putting pressure on the nation’s foreign exchange reserves.

He continued: “Wheat is the 3rd mostly consumed grain in Nigeria after maize and rice. It is estimated that we only produce about one per cent (63,000 MT) of the 5-6 million MT of wheat consumed annually in Nigeria. This enormous demand supply gap is bridged with over $2 billion annual importation of wheat.

“We have concluded the 1st major wet season wheat farming in Plateau State and planted over 100,000 hectares of wheat across 15 states in the 2021 dry season. This strategic intervention will herald progressive reduction in our wheat import bills over the coming years.”

Additionally, the Programme also established a Strategic Maize Reserve with the stock of maize submitted as loan repayment by farmers, to provide a buffer for price modulation for the poultry and feed mills nationwide.

Accordingly, he said: “A total of 241,656.76 MT was aggregated in the 2020 wet and dry seasons, out of which 217,218.53 MT has been disposed of to 18 millers and poultry farmers through the Poultry Association of Nigeria. The programme was able to stabilize the poultry and livestock sectors during the pandemic and saved the industry and consumers over N10 billion in raw material costs.

Operational efficiency

To enhance governance, Emefiele said the CBN has added several layers of controls to improve operational efficiency, transparency and accountability among all stakeholders.

He noted that successes recorded thus far demonstrate the growth and enormous potential in Nigeria’s agricultural space, which can be harnessed to lead the economic diversification agenda.

He explained that the mega pyramids being launched today represents aggregated paddy rice submitted as repayment of loans by RIFAN farmers under the 2020 dry season and 2021 wet seasons.

“Beyond the event, it also symbolizes the efforts made by our farmers to commit to loan repayment through produce submission and ultimately ensure the sustainability of the Programme.

“To further create value and transfer these gains along the value chain, we have mapped millers to off-take these paddies and we will track the release of their outputs to the market as we strive to manage inflation and grow the rice value chain in Nigeria,” he said.

 Commodity Exchange

To further enhance farmers’ fortunes, Emefeile said the Nigeria Commodity Exchange (NCX), was resuscitated as another strategic initiative to enhance the food security drive.

According to him, a vibrant commodity exchange will significantly enhance postharvest handling, reduce wastages and guarantee effective pricing for farmers.

He said: “It will also minimize the adverse effects of the activities of middlemen, commodity hoarders and ultimately transfer the gains from primary production to other nodes of the value chain.

“This aligns with our resolve to take outputs as loan repayment under the ABP and the produce will drive the operations of the commodity exchange going forward.

“We have deepened our stakeholders’ engagement to increase the arable land under cultivation and improve the productivity per hectare using improved seeds and agronomic practices.

“We are currently exploring a new rice seed variety with RIFAN that has potential to deliver over 8 tons per ha. The pilot programme should commence in the 2022 dry season, and it has the potential of being the game changer for the rice sector in Nigeria.”

Future impact  

On his part, the Governor of Ekiti State, and Chairman of the Nigeria Governors’ Forum (NGF), Dr Kayode Fayemi, said the next agenda of the administration’s food security programme is to ensure the affordability of food items.

Also speaking, the Governor of Kebbi State, Atiku Bagudu, said rice production has significantly improved at a level where a farmer can now earn N400,000 per hectare.

Similarly, Cross River State Governor, Prof. Ben Ayade, said he took advantage of the robust economic diversification policy to establish the Ogoja rice revolution, using the best-in-class technology.

His counterpart in Ebonyi State, Governor David Umeahi, while insisting that his state is the largest rice producer in Nigeria, as quoted by the National Bureau of Statistics (NBS), noted that food security is the key to eradicating many social maladies.

He added that the agricultural revolution is part of the oneness and unity of the country, as it promotes greater peace and harmony.

Agreeing, the Jigawa State Governor, Badaru Abubakar, said the agricultural revolution has catapulted his state to a N1.6trillion GDP, with the state seeing many integrated rice mills and thousands of smallholder millers. This also resulted in agriculture support services across the value chain leading to high youth employment rate and dramatic reduction in urban migration.      

For the Rice Farmers Association of Nigeria (RIFAN), the pyramids demonstrate that local production of food is possible, adding that this will crash the price of rice in the country.

Specifically, the Chairman Pyramid Sub-Committee, RIFAN, Shehu Muazu, said the paddy would be allocated to processors immediately after the pyramids are unveiled, noting that RIFAN in collaboration with the Rice Millers Association of Nigeria would process the rice and sell at a discounted price.

“This will lead to a drastic reduction in price once it starts rolling into the market. Our collaboration with the millers association rests on the agreement that they will sell at a discounted price to Nigerians.

“Although, we cannot talk of price in isolation, because prices all over the world food prices have gone up. But the good news is that rice will remain the cheapest commodity in Nigeria as far as food is concerned due to the success recorded through the scheme,” he said.

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